Tehran Warns Pakistan Over Completion of Gas Pipeline

Tehran has warned Islamabad over falling behind the schedule in fullfiling its obligations in a multi-billion-dollar pipeline project that is to take natural gas from Iran to Pakistan.

“Under a contract signed between Iran and Pakistan, the latter had to deliver its commitments by starting import of Iran’s gas supplies in December 2014, but it seems unlikely for Pakistan to take any measure before the end of 2015,” Reza Araqi, the managing director of the National Iranian Gas Company, told reporters in Tehran on Saturday.

Araqi also denied reports that Iran has decided not to fine Islamabad for its long delay in completing the project. Under the Gas Sales Purchase Agreement signed with Iran in 2009, the first flow of gas to Pakistan should have started no later than 31 December 2014.

The Iran-Pakistan (IP) pipeline begins from Assalouyeh on the Persian Gulf, and stretches over 1,100km (684 miles) through southern shores and Iranian Baluchistan before reaching the Pakistani border, with construction on the Iranian side completed two years ago. Pakistan was to build the remaining section through Pakistani Baluchistan and Sindh, but has not even begun the work.

IP pipeline has been a controversial project from the very beginning. It was originally designed as Iran-Pakistan-India (IPI) to take gas to India. The Indian government, citing concerns over Iran sanctions, bowed out of the project, which then became the IP pipeline. Now it seems that only an I-pipeline has remained!

File photo: IP pipeline under construction in Iranian Baluchistan. (IRNA)

Iran Could be ‘Reliable’ Gas Supplier to EU - Minister

Amid Ukraine Crisis

Iran could be a “reliable, secure and long-term” supplier of gas to Europe, Iranian Minister of Industry Mohammad Reza Nematzadeh said in an interview with business daily Handelsblatt. (AFP/ Al Arabiya News, 14 April)

“We don’t want to compete with Russia. But we know that Europe’s demand for gas is increasing and would like a share in this,” Nematzadeh said. “We have the energy reserves and cooperation plans. But as far as Russia is concerned, that is a decision for Europe alone,” he added.

The minister’s statement seems to be taking advantage of the West’s irritation against Russia’s involvement in Ukraine. There have been calls in the West from influential opinion makers for reduction of Europe’s reliance on Russian gas.

File photo: Natural gas facilities in Assaluyeh on the Persian Gulf (IRNA)

U.S. Lifts Sanctions against Iran Petrochemical Companies

The U.S. Office of Foreign Asset Control (OFAC) on Monday lifted sanctions against 14 Iranian petrochemical companies as the first step of easing sanctions under the 24 November Geneva agreement.

The petrochemical companies are: Bu Ali Sina, Nouri, Shahid Tondgouyan, Bandar Imam, Mobin, Pars, Shazand, Tabriz, Qaed Basir, Poulinar, Ariya Sasoul, Saderat-e Assalouyeh, Marjan and Jam.

The companies can now start selling their products globally and receive foreign currencies for goods sold through normal banking channels.

The development is particularly important for the country’s petrochemical industry. Unlike increasing crude oil production to pre-sanctions levels, the petrochemical plants can be restarted almost immediately without any major investments. But they need to produce products that could be easily marketed and transported globally.

File photo: Petrochemical plants in Assalouyeh on the shores of the Persian Gulf. (IRNA)

Iran Signs Agreement to Export Natural Gas to Iraq

Iran has signed an agreement with Iraq for delivery of natural gas to the country, Iranian deputy oil minister announced today.

“Based on this agreement, 25 million cubic meters of gas will be delivered to Sadr, Baghdad and al-Mansouryah power plants through pipeline,” Mohammad Javad Owji said in Baghdad today. (IRNA/Press TV, 21 July)

The agreement was signed in the Iraqi capital by Iran’s Oil Minister Rostam Qasemi and his Iraqi counterpart, Abdul Kareem Luaibi.

“By signing this deal, Iran will earn USD 10 million a day and USD 3.7 billion a year in revenues,” Owji said.

He added that Iran has already completed the construction of its 227-kilometer section of the pipeline to carry natural gas to Iraq, and the 270-kilometer Iraqi section will be completed in one or two months.

The pipeline will stretch from Assaluyeh, near the massive offshore South Pars gas field in southern Iran, and will continue into Iraq.

File photo: South Pars gas field installation in Assaluyeh, southern Iran (IRNA)

Monthly Revenues of New Petrochemical Projects At $1 Billion

Iran’s monthly revenues from its new petrochemical projects has surged to $1 billion in the first two months of the new Iranian calendar that started on 21 March, Iranian news agency Fars reported today. Five petrochemical projects have come online during the period.

“These projects have raised nameplate production of petrochemicals by 2.728 million tons," said National Petrochemical Company's managing director Abdolhosain Bayat.

”Since 2005, 51 petrochemical projects have come on stream with $22 billion investment raising the nominal production capacity of petrochemicals by 38 million tons per year,” he added. (Fars News Agency, 25 May)

File photo: Southern Pars petrochemical complex at Assaluyeh on Persian Gulf coast.  

Iran to Cancel China Gas Contract

Iran has warned China it could cancel a much-delayed $5-billion offshore gas exploration contract to develop South Pars field in the Persian Gulf, Iran’s oil ministry announced on Monday.

“There is a possibility of cancelling the contract signed in 2009 to develop the South Pars gas field -- which holds around eight percent of the world's gas reserves,” said oil ministry spokesman Alireza Nikzad. (Mehr News Agency, 24 December)

  

South Pars, a huge offshore natural gas field shared between Iran and Qatar, holds one of the world’s largest reserves of natural gas. China National Petroleum Corporation (CNPC), China’s largest oil and gas producer and supplier, was contracted for the project.

Iran has accused China in the past of failing to fulfill its commitments and delaying its contractual obligations. It suspended a $16-billion contract with China last year for the North Pars gas field.

“The Chinese side has stated it is not inclined to be part of the project's (South Pars) development,” citing the “high risk” involved in offshore exploration, Nikzad added.

Major Western companies that had been operating in South Pars, among them France's Total and Anglo-Dutch Shell, withdrew from Iran between 2007 and 2010 after international sanctions were imposed over Iran’s controversial nuclear program.

File photo: Land-based facilities at Assaluyeh, Iran, closest land pint to South Pars gas field. (IRNA)